LONDON - General Electric Co., the world's largest maker of aircraft engines, agreed yesterday to buy the aerospace business of Smiths Group P.L.C., Britain's third-largest aerospace company, for $4.8 billion in cash.

Smiths will return $2.1 billion to shareholders, the London-based company said. GE and Smiths also announced plans for a joint venture called Smiths GE Detection.

The market reacted enthusiastically, pushing Smiths shares up more than 15 percent to $22.24 on the London Stock Exchange. The company has been under shareholder pressure to break itself up, but has resisted.

GE, based in Fairfield, Conn., said the purchases would broaden its aerospace portfolio by adding Smiths' flight-management systems, electrical power management, mechanical-actuation systems, and airborne-platform computing systems.

"GE Aviation is growing about 10 percent a year, and this acquisition gives us a technology growth platform that will be accretive to our net income and will deliver immediate and future value for our investors," GE chairman and chief executive officer Jeff Immelt said in a statement.

Smiths Aerospace has more than 11,000 employees and posted revenue of $2.4 billion in 2006.

It has been working on projects like Boeing's 787 aircraft, the Airbus A380, as well as the Joint Strike Fighter military project.

Smiths will call an extraordinary shareholders' meeting during the second quarter to approve the sale, which is also subject to regulatory approval.

Speaking in a conference call with reporters, Immelt said the acquisition complemented GE's existing business instead of being a consolidation, and he looked forward to "a constructive process" with European Union antitrust regulators.

The European Union blocked GE's attempt to take over Honeywell International Inc. in 2001, although the deal had been approved by U.S. regulators.

Smiths chief executive Keith Butler-Wheelhouse said the decision to sell the aerospace arm was made last autumn.

"The structure of the aerospace industry is changing - in particular its increased capital requirements and the growing importance of supplier scale, especially as the next generation of large programs kicks in."

Butler-Wheelhouse said he had approached GE about buying its Homeland Protection unit during the aerospace negotiations, but was turned down.

The new Smiths GE Detection joint venture will combine Smiths' Detection operations with GE Homeland Protection.

Smiths will own 64 percent, and GE will have 36 percent, with the partners committed to holding those stakes for at least five years.

"Our combination of technologies will result in the development of more effective products and services to help make the world a safer place," Butler-Wheelhouse said.

The joint venture will have pro-forma annual revenue of about $1.2 billion.

Fortis Securities in London commented that the aerospace deal "comes close to a complete breakup" of Smiths.

"The aerospace division is extremely well-placed," Fortis commented, "having major contracts with Boeing, Lockheed Martin and others, but lacks scale for long-term independence."